In December 2003, Abbott Labs raised the price of its Norvir AIDS drug, which is commonly used in HIV drug cocktails, by 400 percent, creating a firestorm in the AIDS community. The mark-up prompted the Service Employees International Union Health & Welfare Fund to file a class-action lawsuit the next year that alleges the price hike violated antitrust laws.
How so? Abbott sells a combo pill called Kaletra that includes Norvir and its own protease inhibitor. The lawsuit claims Abbott raised Norvir’s price - but not the Kaletra price - in order to boost Kaletra sales at the expense of other protease inhibitors that require Norvir as a booster. In other words, Abbott allegedly tried to use Norvir to create a monopoly over the market for protease inhibitors.
The maneuver caused outrage - shareholder resolutions, protests at Abbott headquarters, a boycott by hundreds of docs, Attorney General investigations, and numerous editorials criticizing the increase. Last month, Abbott asked a federal court to seal numerous documents, citing confidentiality, and a judge acquiesced - to a point. Some documents were released in full; others were redacted. As a result, we are left with an incomplete picture of the thinking among Abbott execs.
However, one document seems to indicate at least one person at Abbott worried that a price hike would spur federal investigations, apparently because the drugmaker lacked a justification to charge more for Norvir. This was contained in an e-mail from Abbott exec Jesus Leal, who discusses three strategies that Abbott considered to drive up Kaletra sales. You can read that here.
For a closer look at the released documents, you can visit Prescription Access Litigation, which assisted the union in bringing its suit.
